You are here

Sales Tax For New Jail Ready For April Vote

Published by admin on Thu, 03/01/2018 - 8:29am

At a regular meeting of the Benton County Commissioners held at 9:00 AM on January 22, 2018, a resolution placing a 1/2 Cent Sales Tax proposal was unanimously approved for the April 3, 2018 ballot. The ballot states that the proceeds for this 1/2 Cent Sales Tax (not a property tax) are to be used to construct a new 80 bed jail (expandable to 100 beds) to be located at 1620 East Main Street (east of Highway 65 across from the former Smoke Shack BBQ) along with administrative office space to house the Benton County Sheriff’s operations. This 1/2 Cent Sales Tax will sunset (cease) by September 30, 2039 or upon the final payment of the lease financing, whichever comes first. With voter approval by at least a simple majority, collections from this 1/2 Cent Sales Tax are to begin on October 1, 2018. The Presiding Commissioner Michelle McLerran Kreisler stated that Benton County has been involved in a serious regrouping process since the failure of a similar measure at the April 5, 2016 election. “We have attempted to listen carefully to those citizens who opposed the 2016 proposal as well as our supporters from the 44% of yes votes at that time. As a result of accepting valuable input from the public and a jail committee made up of county citizens, we have made many revisions that are incorporated into this concept,” Ms. Kreisler said.

The predominant differences between the previous proposal and the current one include location and cost. Specifically, the proposed jail will be constructed on an approximate 3.5 acre site at 1620 East Main Street instead of the downtown square area of Warsaw. The County has the site under option to purchase subject to the election results. Additionally, many opponents vocalized that the projected cost of $13,500,000 to $14,500,000 in 2016 was too high. To address this cost sensitivity, the County, after interviewing three firms, engaged the services of HMN Architects of Overland Park, Kansas, who developed a preliminary plan that can theoretically house up to 80 detainees (expandable to 100) with approximately 6,000 square feet to be allocated to administrative office space for the Benton County Sheriff’s office. Sheriff Eric Knox has actively participated with the architects and believes the preliminary design will be a big improvement over what is now available and should be adequate. The total budgeted cost for this jail facility is expected to be $10,000,000. “I appreciate how much effort the HMN Architects have made to meet our needs and yet remain within the acceptable budget,” Sheriff Knox remarked.

The Northern District Commissioner, Jim Hansen, made a point to describe some of the major facts for the public to keep in mind as they study this revised proposal. “The Commission feels that the 1/2 Cent Sales Tax is the best option available to Benton County to address our jail situation. It is not something that the County Commissioners take lightly; but, we do believe that it is our responsibility to those who elected us to address this issue,” Mr. Hansen stated. The existing jail is 160 years old and has a wood and masonry structure with no fire sprinkler system. It has a designed capacity for 28 prisoners (20 men and 8 female). In 2007 the average detainee count was 17 per day and by 2016 the average number was approximately 41, with a high of 58 detainees. The County must pay other counties to house the overflow of detainees plus the transportation expense to deliver and pick them up from the other county facilities. Whenever deputies are occupied with the pick-up and delivery of detainees, they are not available for other law enforcement duties. In 2016, these expenses were approximately $18,498.12 per month and totaled about $221,977.47 for the year according to figures supplied by the County Budget Officer. If the jail were to be closed due to its current condition, the County would still be responsible for housing its inmates at other county jails. That expense assuming 50 detainees per day at present costs could be as high as $821,250 per year, which absorbs all of the revenues presently available to Benton County from its Law Enforcement Sales Tax as well as much of the budgeted funds from General Revenue. It leaves very little to cover the Sheriff’s office activities, which is a potential problem Benton County must avoid.

According to data prepared by the County’s municipal bond underwriter, L.J. Hart & Company of St. Louis, Missouri, the projected revenue from the 1/2 Cent Sales Tax with a two percent (2.00%) growth assumption (3.57% is the average growth for the last five years) and assuming interest rates that are higher than those in the current tax-exempt municipal bond market, an ample amount is available to meet the annual lease payments of principal and interest for a $10,250,000 financing, which is to provide at least $10,000,000 of upfront funding. The County interviewed two other firms prior to deciding to continue with L.J. Hart & Company. The projections make allowances for managing the project costs if the construction bids come in slightly above the estimates of HMN Architects. The financing is to be delayed until the actual project costs are firm based upon the receipt of competitive bids from general contractors or a construction manager qualified to do the work. The Lease Certificates of Participation are to be made available first to local individuals and financial institutional investors before being marketed outside the local area and are to be in denominations of $5,000 with interest payments that are tax-exempt from federal and state of Missouri income taxes.

Although it is difficult to project exactly how much of the sales tax will be paid by visitors to Benton County, it is reasonable to assume a margin of 40% to 60% might be paid by visitors. Whatever the actual figure turns out to be, some of the expense will be absorbed by visitors, whereas with a general obligation bond issue secured by property taxes, all of the payments would be placed upon the local taxpayers. The estimated extra expense for a typical household with median county income will be $2.43 per month or $29.15 for a full year. Another way to quickly grasp the financial impact of this sales tax is to recognize for every $100 spent in Benton County, this 1/2 Cent Sales Tax adds 50 Cents, or $5.00 for every $1,000, $50.00 for every $10,000, etc.

The Southern District Commissioner Dale “Junior” Estes stated that the Benton County Commission expects that there will be several public forums to present the facts about this 1/2 Cent Sales Tax Proposal. “Efforts will also be made to meet with service clubs and other organizations at their request to provide information on the ballot measure and to answer questions that those members have,” Mr. Estes concluded. The County also expects to publish other facts about the jail population, the number of male and female detainees, numbers of arrests for violent versus non-violent crimes, and other factual information that might be of interest prior to the April 3, 2018 election. Questions regarding the proposal or to arrange a time and date for a presentation may be referred to the Benton County Commission at 660-438-7406.

A short informational video on this proposed project is available at the Benton County website: http://www.bentoncomo.com. The video is also available on YouTube.